The Bank of England's Monetary Policy Committee (MPC) voted five to four to maintain quantitative easing (QE) at £325bn this month, overruling the governor and three colleagues who called for further expansion.
The minutes from the Committee's last meeting in June show five members of the MPC - including Charles Bean and Paul Tucker - opted to maintain QE at its current level.
Mervyn King (pictured), David Miles and Adam Posen opted to increase it by £50bn, while Paul Fisher wanted to expand it by £25bn.
The split in the MPC comes after official data yesterday revealed another unexpected fall in inflation in May. Consumer Prices Index (CPI) inflation is now down at 2.8%, having fallen from April's reading of 3%.
In the last two months it has fallen by 0.7%, taking many commentators by surprise.
The drop in inflation, which has taken the headline rate closer to the government's 2% target, has opened the door for more QE, with many economists now expecting an expansion of the Bank's £325bn asset purchase programme to help tackle deflationary forces impacting the UK.
The MPC noted in the minutes that trade has been hit by the eurozone crisis, and it expects net trade "would continue to be weak in the second quarter".
It added there is a chance inflation could fall "materially" below the 2% target.
"To the downside was the possibility that economic growth might prove insufficiently strong to absorb the pool of spare capacity, so inflation would fall materially below the 2% target once the impact of past increase in energy and other import prices had passed," the minutes said.
The MPC added the upside risks to inflation have lessened, with most of the committee judging "some further economic stimulus was either warranted immediately or would probably become warranted in order to meet the inflation target."
However, the majority opted against expanding QE at this stage because of several key events occurring in the eurozone over the coming weeks.
The MPC also opted against cutting the bank rate further from its current level of 0.5%, warning a cut could damage trading in money markets.
"It was possible that, were interest rates to fall further, the functioning of the money markets would become impaired," it said.
"Overall the Committee judged a further reduction in the Bank Rate would not have any advantages over an expansion of the asset purchase programme."
However, it said it is keeping the option to cut rates under review.
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